Atkinson and Stiglitz theorem in the presence of a household production sector

We show that the celebrated Atkinson and Stiglitz (1976) result on the uniformity of the commodity tax rates when preferences are weakly separable between goods and leisure does not hold when (at least) one of the goods is produced within the household. The result is restored if preferences are weakly separable in market goods on the one hand, and leisure and household goods on the other.

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Year of publication:	2014-07
Authors:	Cremer, Helmuth ; Gahvari, Firouz
Institutions:	Institut d'Économie Industrielle (IDEI), Toulouse School of Economics (TSE)
Subject:	Atkinson and Stiglitz theorem \| household production \| weak-separability

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Extent:	application/pdf
Series:	IDEI Working Papers.
Type of publication:	Book / Working Paper
Notes:	Published in Economics Letters, vol. 126, Elsevier, janvier 2015, p. 91-95. The text is part of a series IDEI Working Paper Number 831
Classification:	H2 - Taxation, Subsidies, and Revenue ; H5 - National Government Expenditures and Related Policies
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011240551